**Exhibit 10.3**

** **

**Employee Restricted Stock Unit Agreement**

 

This Employee Restricted Stock Unit Agreement, datedas of [•], 20     (the “Grant Date”), betweenServiceMaster Global Holdings, Inc., a Delaware corporation, and theemployee whose name appears on the signature page hereof, is being enteredinto pursuant to the ServiceMaster Global Holdings, Inc. Stock IncentivePlan.  The meaning of capitalized termsmay be found in Section 7.

 

The Company and the Employee hereby agree asfollows:

 

Section 1.              Grant of Restricted Stock Units

 

(a)               Confirmation of Grant.  Subject to the terms of this Agreement, theCompany hereby evidences and confirms, effective as of the date hereof, itsgrant to the Employee of Restricted Stock Units representing the right toreceive the number of shares of Common Stock specified on the signature page hereof.  This Agreement is entered into pursuant to,and the terms of the Restricted Stock Units are subject to, the terms of thePlan.  If there is any conflict betweenthis Agreement and the terms of the Plan, the terms of the Plan shall govern.

 

(b)               Employee Unit Account.  The Company will establish a separatenotional account for the Employee and will record in such account the number ofRestricted Stock Units awarded to the Employee pursuant to this Agreement.

 

Section 2.              Vesting and Forfeiture

 

(a)               Based on Continued Employment.  The Employee’s Restricted Stock Units shallvest in three equal installments on the first, second and third anniversariesof the Grant Date subject to the Employee’s continued employment with theCompany or any Subsidiary through the applicable vesting date.

 

(b)               Effect of a Change in Control.  In the event of a Change in Control occurringprior to the third anniversary of the Grant Date, subject to the Employee’scontinued employment with the Company or any Subsidiary from the Grant Date tothe date of the Change in Control, any Restricted Stock Units which areunvested shall automatically become vested.

 

(c)               Discretionary Acceleration.  The Board, in its sole discretion, mayaccelerate the vesting of all or a portion of the Restricted Stock Units at anytime and from time to time.

 

(d)               Effect of Termination ofEmployment.  Upon termination of theEmployee’s employment with the Company and its Subsidiaries for any reason(whether initiated by the Company or by the Employee), any unvested RestrictedStock Units shall be forfeited, provided that if the Employee’semployment is terminated in a Special Termination (i.e., by reason of theEmployee’s death or 

 

----

 

Disability), the Employee’s Restricted StockUnits shall vest as to the number of Restricted Stock Units that would havevested on the next anniversary of the Grant Date (assuming the Participant’semployment had continued through such anniversary) multiplied by a fraction,the numerator of which is the number of days elapsed since (x) theGrant Date, if the Special Termination occurs on or prior to the firstanniversary of the Grant Date, or (y) the most recent prioranniversary of the Grant Date, if the Special Termination occurs after thefirst anniversary of the Grant Date, and the denominator of which is 365.

 

Section 3.              Dividend Equivalents

 

Ifthe Company pays any cash dividend or similar cash distribution on the CommonStock, the Company shall credit to the Employee’s account an amount equal tothe product of (x) the number of the Employee’s Restricted StockUnits as of the record date for such distribution times (y) the pershare amount of such dividend or similar cash distribution on CommonStock.  Any cash amounts credited to theEmployee’s account shall be paid to the Employee on the Settlement Date (asdefined below).  If the Company makes anydividend or other distribution on the Common Stock in the form of Common Stockor other securities, the Company will credit the Employee’s account with thatnumber of additional shares of Common Stock or other securities that would havebeen distributed with respect to that number of shares of Common Stockunderlying the Employee’s Restricted Stock Units as of the record datethereof.  Any such additional shares ofCommon Stock or other securities shall be subject to the same restrictions asapply to the Restricted Stock Units.

 

Section 4.              Settlement

 

Subjectto Section 8(a), promptly following the date on which a Restricted StockUnit becomes vested, and in any event no later than March 15th of the calendar year following thecalendar year in which such vesting occurs (the “Settlement Date”), theEmployee shall receive, without payment, one Settlement Share in respect ofeach such Restricted Stock Unit.  On orbefore any Settlement Date, unless otherwise determined by the Board, theCompany and the Employee shall enter into a Subscription Agreement thatcontains repurchase rights, a voting proxy and transfer and other restrictionson the Settlement Shares in the form then customarily used by the Company forsuch purpose; provided that, if the Employee has previously entered intoa Subscription Agreement containing such restrictions, then the SettlementShares shall be treated as “Shares” for purposes of that Subscription Agreementand shall be subject to such restrictions.

 

2

----

 

Section 5.              Employee’s Representations andWarranties

 

(a)               Access to Information, Etc.  The Employee represents and warrants asfollows:

 

(i)        the Employee understands the terms andconditions that apply to the Restricted Stock Units and the risks associatedwith an investment in the Restricted Stock Units;

 

(ii)       the Employee has a good understanding ofthe English language; and

 

(iii)      the Employee is an officer or employee ofthe Company or one of its Subsidiaries.

 

(b)               No Right to Awards.  The Employee acknowledges and agrees that thegrant of any Restricted Stock Units (i) is being made on anexceptional basis and is not intended to be renewed or repeated, (ii) isentirely voluntary on the part of the Company and its Subsidiaries and (iii) shouldnot be construed as creating any obligation on the part of the Company or anyof its Subsidiaries to offer any Restricted Stock Units in the future.

 

(c)               Investment Intention.  The Employee represents and warrants that theEmployee has been awarded the Restricted Stock Units and any Settlement Sharesdelivered in respect thereof for his or her own account for investment and noton behalf of any other person or with a view to, or for sale in connectionwith, any distribution of the Restricted Stock Units.

 

Section 6.              Restriction on Transfer;Non-Transferability of Restricted Stock Units

 

TheRestricted Stock Units are not assignable or transferable, in whole or in part,and they may not, directly or indirectly, be offered, transferred, sold,pledged, assigned, alienated, hypothecated or otherwise disposed of orencumbered (including, but not limited to, by gift, operation of law orotherwise).  Any purported Transfer inviolation of this Section 6 shall be void abinitio.

 

Section 7.              Certain Definitions  As used in this Agreement, capitalized termsthat are not defined herein have the respective meanings given to them in thePlan, and the following additional terms shall have the following meanings:

 

“Agreement” means this EmployeeRestricted Stock Unit Agreement, as amended from time to time in accordancewith the terms hereof.

 

“Company” means ServiceMaster GlobalHoldings, Inc., provided that for purposes of determining thestatus of Employee’s employment with the “Company,” such term shall include theCompany and its Subsidiaries.

 

3

----

 

“Employee” means the grantee of theRestricted Stock Units, whose name is set forth on the signature page ofthis Agreement; provided that where appropriate to effectuate the intentof this Agreement, following an Employee’s death “Employee” shall be deemed toinclude such person’s beneficiary or estate and follow such Person’sDisability, “Employee” shall be deemed to include such person’s legalrepresentative.

 

“Grant Date” has the meaning given inthe Preamble.

 

“Plan” means the ServiceMaster GlobalHoldings, Inc. Stock Incentive Plan, as previously adopted by the Companyand as amended from time to time in accordance with its terms.

 

“Restricted Stock Unit” means thecontractual entitlement to Common Stock evidenced by (and subject to the termsand conditions of) this Agreement.

 

“Securities Act” means the UnitedStates Securities Act of 1933, as amended, or any successor statue, and the rules andregulations thereunder that are in effect at the time, and any reference to aparticular section thereof shall include a reference to the correspondingsection, if any, of such successor statute, and the rules and regulations.

 

“Settlement Date” has the meaninggiven in Section 4.

 

“Settlement Share” means a share ofCommon Stock delivered in respect of a Restricted Stock Unit pursuant to Section 4.

 

“Transfer” has the meaning given inthe Subscription Agreement to which the Employee is a party.

 

Section 8.              Miscellaneous

 

(a)               Withholding.  The Company or one of its Subsidiaries shallrequire the Employee to remit to the Company an amount in cash sufficient tosatisfy any applicable U.S. federal, state and local and non-U.S. taxwithholding obligations that may arise in connection with the vesting of theRestricted Stock Units and the related issuance of the Settlement Shares.  Notwithstanding the preceding sentence, ifthe Employee elects not to remit cash in respect of such obligations, theCompany shall retain a number of Settlement Shares subject to the RestrictedStock Units then vesting that have an aggregate Fair Market Value as of theSettlement Date equal to the amount of such taxes required to be withheld (andthe Employee shall thereupon be deemed to have satisfied his or her obligationsunder this Section 8(a)); provided that the number of SettlementShares retained shall not be in excess of the minimum amount required tosatisfy the statutory withholding tax obligations (it being understood that thevalue of any fractional share of Common Stock shall be paid in cash).  The number of Settlement Shares to be issuedshall thereupon be reduced by the number of Settlement Shares so retained.  The method of withholding set forth in theimmediately preceding sentence shall

 

4

----

 

notbe available if withholding in this manner would violate any financinginstrument of the Company or any of its Subsidiaries or to the extent that,following a Public Offering, a facility is in place by which the Employee maysell Settlement Shares in the public market to satisfy such obligations.

 

(b)               Limitation of Benefits.  If, whether as a result of acceleratedvesting, the grant of an Alternative Award or otherwise, the Employee wouldreceive any payment, deemed payment or other benefit as a result of theoperation of Section 2(b) that, together with any other payment,deemed payment or other benefit the Employee may receive under any other plan,program, policy or arrangement, would constitute an “excess parachute payment”under section 280G of the Code, then, notwithstanding anything in thisAgreement to the contrary, the payments, deemed payments or other benefits theEmployee would otherwise receive under Section 2(b) shall be reducedto the extent necessary to eliminate any such excess parachute payment and theEmployee shall have no further rights or claims with respect thereto.  If the preceding sentence would result in areduction of the payments, deemed payments or other benefits the Employee wouldotherwise receive under this Agreement (together with any reductions under anyother plan, program, policy or arrangement) on an after-tax basis by more than5%, the Company will use its commercially reasonable best efforts to seek theapproval of the Company’s shareholders in the manner provided for in section280G(b)(5) of the Code and the regulations thereunder with respect to suchreduced payments or other benefits (if the Company is eligible to do so), sothat such payments would not be treated as “parachute payments” for thesepurposes (and therefore would cease to be subject to reduction pursuant to thisSection 8(b)); provided, however, that if the Company seeks suchapproval on behalf of the Employee, the Company’s request for the approval ofsuch payments to the Employee shall be submitted to the shareholders on asingle slate with all other persons for whom such approval is being sought, andnot individually.  This Section 8(b) shallcease to apply if the stock of the Company or any direct or indirect parent orsubsidiary of the Company becomes readily tradable on an established securitiesmarket or otherwise within the meaning of 26 CFR 1.280G-1, Q/A-6.

 

(c)               Authorization to SharePersonal Data.  The Employeeauthorizes any Affiliate of the Company that employs the Employee or thatotherwise has or lawfully obtains personal data relating to the Employee todivulge such personal data to the Company if and to the extent appropriate inconnection with this Agreement or the administration of the Plan.

 

(d)               No Rights as Stockholder; NoVoting Rights.  The Employee shallhave no rights as a stockholder of the Company with respect to any RestrictedStock Units or Settlement Shares covered by the Restricted Stock Units untilthe delivery of the Settlement Shares.

 

(e)               No Right to ContinuedEmployment. Nothing in this Agreement shall be deemed to confer on the Employeeany right to continue in the employ of 

 

5

----

 

theCompany or any Subsidiary, or to interfere with or limit in any way the rightof the Company or any Subsidiary to terminate such employment at any time.

 

(f)                Notices.  All notices and other communications requiredor permitted to be given under this Agreement shall be in writing and shall bedeemed to have been given if delivered personally or sent by certified orexpress mail, return receipt requested, postage prepaid, or by any recognizedinternational equivalent of such delivery, to the Company or the Employee, asthe case may be, at the following addresses or to such other address as theCompany or the Employee, as the case may be, shall specify by notice to theother:

 

(i)        if to the Company, to it at:

 

ServiceMaster Global Holdings, Inc.c/o The ServiceMaster Company

860 Ridge Lake BoulevardMemphis, Tennessee  38120

Attention:General Counsel

Fax: (901) 597-8025

 

(ii)       if to the Employee, to the Employee athis or her most recent address as shown on the books and records of the Companyor Subsidiary employing the Employee.

 

All such notices and communications shall be deemedto have been received on the date of delivery if delivered personally or on thethird business day after the mailing thereof. Copies of any notice or other communication given under this Agreementshall also be given to:

 

Clayton, Dubilier & Rice, LLC375 Park Avenue, 18th FloorNew York, New York  10152Fax:  (212) 407-5252Attention:  David Wasserman

 

and

 

Debevoise & Plimpton LLP919 Third Avenue New York, New York 10022 Fax:  (212) 909-6836Attention:  John M. Allen

 

(g)                                              Binding Effect; Benefits.  This Agreement shall be binding upon andinure to the benefit of the parties to this Agreement and their respectivesuccessors and assigns.  Nothing in thisAgreement, express or implied, is intended or shall be construed to give anyperson other than the parties to this Agreement or their

 

6

----

 

respectivesuccessors or assigns any legal or equitable right, remedy or claim under or inrespect of any agreement or any provision contained herein.

 

(h)               Waiver; Amendment.

 

(i)        Waiver.  Any party hereto or beneficiary hereof may bywritten notice to the other parties (A) extend the time for theperformance of any of the obligations or other actions of the other partiesunder this Agreement, (B) waive compliance with any of theconditions or covenants of the other parties contained in this Agreement and (C) waiveor modify performance of any of the obligations of the other parties under thisAgreement.  Except as provided in thepreceding sentence, no action taken pursuant to this Agreement, including,without limitation, any investigation by or on behalf of any party orbeneficiary, shall be deemed to constitute a waiver by the party or beneficiarytaking such action of compliance with any representations, warranties,covenants or agreements contained herein. The waiver by any party hereto or beneficiary hereof of a breach of anyprovision of this Agreement shall not operate or be construed as a waiver ofany preceding or succeeding breach and no failure by a party or beneficiary toexercise any right or privilege hereunder shall be deemed a waiver of suchparty’s or beneficiary’s rights or privileges hereunder or shall be deemed awaiver of such party’s or beneficiary’s rights to exercise the same at anysubsequent time or times hereunder.

 

(ii)       Amendment.  This Agreement may not be amended, modified orsupplemented orally, but only by a written instrument executed by the Employeeand the Company.

 

(i)                Assignability.  Neither this Agreement nor any right, remedy,obligation or liability arising hereunder or by reason hereof shall beassignable by the Company or the Employee without the prior written consent ofthe other.

 

(j)                Applicable Law.  This Agreement shall be governed in allrespects, including, but not limited to, as to validity, interpretation andeffect, by the internal laws of the State of Delaware, without reference toprinciples of conflict of law that would require application of the law ofanother jurisdiction.

 

(k)               Section and OtherHeadings, etc.  The section andother headings contained in this Agreement are for reference purposes only andshall not affect the meaning or interpretation of this Agreement.

 

(l)                Counterparts.  This Agreement may be executed in any numberof counterparts, each of which shall be deemed to be an original and all ofwhich together shall constitute one and the same instrument.

 

[signature page follows]

 

7

----

 

IN WITNESS WHEREOF, the Company and the Employeehave executed this Agreement as of the date first above written.

 

 
|                                                                                                                         | SERVICEMASTER GLOBAL HOLDINGS, INC. |
|------------------------------------------------------------------------------------------------------------------------------|------------------------------------------|
|                                                                                                                         |                                     |
|                                                                                                                         | By:                                      |   |
|                                                                                                                         | Name:                                    |   |
|                                                                                                                         | Title:                                   |   |
|                                                                                                                         |                                     |
|                                                                                                                         |                                     |
|                                                                                                                         | THE EMPLOYEE:                            |
|                                                                                                                         |                                     |
|                                                                                                                         | [·]                                 |
|                                                                                                                         |                                     |
|                                                                                                                         |                                     |
|                                                                                                                         |                                     |
| Total Number of Shares of Common Stock as to which  Restricted Stock Units have been Granted Pursuant Hereto:  [·] |                                     |
|                                                                                                                              |                                          |  |  |

 

8

----